DRAFT FOR DISCUSSION PURPOSES ONLY

August07-VI

Consortium Term Loan

List of Documents

Agreements

S.No. Title Description Remarks

1. Facility Facility Agreement
between the Borrower, the
Lead Bank and the
consortium term lenders
2. Inter-Se Inter-Se Agreement
between the Lead Bank
and the consortium term
lenders; & format of letter
to be issued by the
Borrower and third party
security provider if any
acknowledging the Inter-
Se Agreement
3. Supplemental Supplemental and
& Amendatory Agreement
Amendatory
4. Novation Novation Notice
Notice
This format of facility / loan
agreement is to be used when
term loan facility is provided to
a borrower by a consortium of
lenders.
This format of Inter Se
Agreement is to be used when
interse pari passu arrangement
is to be entered into between
consortium term loan lenders
This format of Supplemental &
Amendatory Agreement is to
be used in case of enhancement
of facility and/or modification
to the facility agreement for
consortium term loan
This format is to be used when
a lender wants to novate /
transfer its debt to another
lender / when an existing
consortium lender is being
substituted by another lender.
The security documents will
need to be modified for the
purpose of substitution of the
existing lender by the new
lender

Standard Terms

S.No. Title Description Remarks

1. General General Conditions – as These General Conditions-VI
Conditions applicable to the Facility is to be used alongwith
Agreement facility / loan agreement when
term loan facility is provided to

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a borrowe by a consortium of
lenders
2. Joint Deed of Standard Terms (07-VI) These standard terms are to be
Hypothecation as applicable to Joint used when deed of
Deed of Hypothecation hypothecation is executed for
for consortium term loan securing consortium term loan.
A copy of these standard terms
should be handed over to the
hypothecator.
3. Guarantee Standard Terms (07-VI) This format of standard terms
as applicable to is applicable to guarantee for
Guarantee for consortium consortium term loan
term loan
4. Joint Standard Terms (07-VI) These standard terms are to be
Mortgage as applicable to Joint used when mortgage deed is
Deed Mortgage Deed for executed for securing
consortium term loan consortium term loan. A copy
of these standard terms should
be handed over to the
mortgagor.

Resolutions

S.No. Title Description Remarks

1. Board Board Resolution – to be This format of board resolution
Resolution- provided by the Borrower is to be used when the
Borrower borrower is a company and is
required to furnish resolution
for borrowing, etc.
2. Board Board Resolution – to be This format of board resolution
Resolution- provided by the guarantors is to be used when the third
Guarantors / third party security party is a company and is
providers required to furnish resolution
for third party security, etc.
3. Resolution Resolution under Section This is indicative format of
under 293(1)(a) of the resolution to be passed by a
Sec.293(1) Companies Act, 1956 company under Section 293(1)
(a) of Co. (a) in connection with security
Act over immoveable and
moveable assets (including
shares) of the company in
favour of lenders / lenders'
trustee

Secuirty Documents

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S.No. Title Description Remarks

1 Deed of Deed of Hypothecation to be
Hypothecation executed by the borrower in
favour of the Consortium Term
Lenders
2 Supplemental
DOH
3 Addendum
Letter
4 Guarantee
5 Confirmatory
letter
6 MOE –
Borrower
This format of Joint Deed of
Hypothecation is to be used
when security is created over
moveable assets in favour of
consortium term lenders
Supplemental Deed of This format of Supplemental
Hypothecation DOH is to be used when the
same assets are to be secured
by the borrower for addl.
facility provided to the
borrower for the same purpose
as earlier facility AND/OR
addl. assets are to be secured
for the existing consortium
term loan and / or additional
consortium term loan
Addendum Letter Letter in this format is to be
issued by the Borrower in
cases where all fixed assets or
all assets to be acquired out of
the proceeds of the facility are
secured and as and when
additional assets are acquired,
the Borrower has to notify the
Lenders of such assets which
are intended as secured under
earlier Deed of Hypothecation
for consortium loan
Guarantee This format of guarantee is to
be used when guarantee (both
personal and corporate) is to be
taken for consortium term loan
Confirmatory letter from This format is to be used when
guarantors / pledgors / third the guarantor issues a letter
party security providers to be confirming extension of the
taken when supplemental and earlier guarantee for additional
amendatory agreement is loans provided by the
entered into consortium term lenders for the
same purpose
Memorandum of Entry – This format is to be used when
mortgage by deposit of title mortgage by deposit of title
deeds by the Borrower – first deeds is being created by the
time Borrower for the first time on
particular properties

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7 MOE – third Memorandum of Entry – This format is to be used when

party mortgage by deposit of title mortgage by deposit of title
deeds by the third party – first deeds is being created by the
time third party for the first time on
particular properties
8 MOE – third Memorandum of Entry – This format of memorandum
party mortgage by deposit of title of entry is to be used when
Borrower – deeds by the Borrower – equitable mortgage is created
constructive constructive delivery by the borrower over a
delivery property which is already
secured and whose title deeds
are already lying with the lead
bank
9 MOE – third Memorandum of Entry – This format of memorandum
party - mortgage by deposit of title of entry is to be used when
constructive deeds by the third party – equitable mortgage is created
delivery constructive delivery by the third party over a
property which is already
secured and whose title deeds
are already lying with the lead
bank
10 Declaration - Declaration to be executed by This format of declaration is to
Borrower the Borrower for mortgage be used when mortgage is
being created by the borrower
11 Declaration - Declaration to be executed by a This format of declaration is to
third party third party for mortgage be used when mortgage is
being created by the third party
12 Mortgage Mortgage Deed – to be This format of mortgage deed
Deed - executed by the Borrower is to be used when the
Borrower borrower is mortgaging the
assets belonging to the
borrower. The assets can be in
the nature of immoveable
properties, moveable properties
(like plant & machinery, bank
accounts, receivables, etc.)
13 Mortgage Mortgage Deed – to be This format of mortgage deed
Deed – third executed by a third party is to be used when a third party
party is mortgaging the assets
belonging to such third party
for the financial assistance to
the borrower.
14 Supplemental Supplemental Mortgage Deed This format of Supplemental
Mortgage -- to be used when the same mort.deed is to be used when
Deed assets are to be secured for the same assets are to be
additional facility provided to secured for addl. facility

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the Borrower for the same provided to the borrower for

purpose as earlier facility
AND/OR additional assets are
to be secured for the existing
facility &/or additional facility
15 Pledge Pledge Agreement – to be used
Agreement when pledge of dematerialized
shares held by pledgor/s in the
Borrower company is to be
made in favour of consortium
term lenders
16 DOM to DOH Deed of Modification to Deed
or Mortgage of Hypothecation or Mortgage
Deed Deed – to be used when
modification to the terms of the
Deed of Hypothecation or
mortgage deed is to be made
the same purpose as earlier
facility AND/OR addl. assets
are to be secured for the
existing facility &/or
addl.facility
This agreement is to be used
for pledge of shares in
dematerialized form of the
borrower company by a third
party -- the per centage of
shares could be either 100% of
shareholding or such number
which is agreed to by the
lenders - for cons.term loan
This deed of modification is to
be used when modifications
are to be carried out to
executed deed of
hypothecation and mortgage
deed for consortium loan

Undertakings

S.No. Title Description Remarks

1. Creation of Undertaking to be provided for This format of undertaking is
further creation of further security – in to be used when part security is
security case only part of the stipulated created and balance security is
security is being created for to be created within a
the time being particular time period
2. Non disposal – Non disposal undertaking – for This is the format of
Dematerialized shares held in dematerialised undertaking for non disposal of
form form shares held in physical form, to
be taken from certain persons
as may be required by the
lenders, eg. promoters,
directors, etc.
3. Non disposal – Non disposal undertaking – for This is the format of
Physical form shares held in physical form undertaking for non disposal of
shares held in dematerialised
form, to be taken from certain
persons as may be required by
the lenders, eg. promoters,
directors, etc.
4. Shortfall Shortfall undertaking This is a format of shortfall /
unsecured loans undertaking to

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be provided by third parties,

eg. promoters of a company, in
the eventuality of a shortfall in
the funds of the company to
meet the cost of the project or
meeting working capital
requirements

Letters

S.No. Title Description Remarks

1. Authority Authority letter to the lead bank This format of letter is to be
to be issued by the consortium used when authority is being
term lenders given by the consortium term
lenders to the lead bank
2. Ceding Letter to be issued by prior This format is to be used when
subsequent chargeholders ceding second / prior chargeholders are
charge subsequent charge in favour of required to issue letter ceding
second / subsequent charge second / subsequent charge
3. Existing Letter to be issued by prior This format is to be used when
subsequent chargeholders to such existing the existing lenders in whose
charge second / subsequent favour or for whose benefit
chargeholders who have already prior charge has been created is
ceded prior charge for earlier granting further assist. also on
assistances prior charge basis & the prior
and subsequent chghldrs have
entered into inter se
arrangement already earlier
4. Existing Letter to be issued by existing This format of letter is to be
subsequent second / subsequent used when prior charge is to be
charge chargeholders ceding prior ceded by second / subsequent
ceding prior charge chargeholders
charge
5. Pari Passu Letters ceding pari passu charge This format is to be used when
charge to be issued by existing lenders charge is to be ceded in favour
to other lenders who will be of new lenders by existing
providing financial assistance lenders on a pari passu basis
secured on the same assets on a
pari passu basis

Power of Attorney

S.No. Title Description Remarks

1. POA Power of attorney to be executed This format of POA is to be
in favour of the Lenders by the used when part security is
security provider simultaneously created and undertaking for

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with undertaking being provided balance security creation is

for creation of further security
taken and authority in favour
of lenders / security trustee is
required from the security
provider for creation of such
balance security

Others

S.No. Title Description Remarks

1. Cert.U/S.281(1) Certificate under Section This is format of certificate /
(ii)of IT Act 281(1)(ii) of the Income approval / permission to be
Tax Act, 1961 taken to protect interest of
lenders / chargeholders-- in
terms of S. 281(1)(ii) of the
Income Tax Act, 1961

User Notes

S.No. Title Description Remarks

1. Le-Handbook Le-Handbook – a reference note This almanac / reference
for facilitating finalization of book / handbook sets out
consortium term loan documents some useful legal tips /
guidelines to be followed
whilst finalising
2. Facility User Note in relation to the This user note is to facilitate
Agreement Facility Agreement the users for finalisation of
facility agreement for
consortium term loan
3. DOH, Sup. User Note in relation to Deed of This user note is to facilitate
DOH & Hypothecation, Supplemental the users for finalisation of
Addendum Ltr. Deed of Hypothecation and deed of hypothecation to be
Addendum Letter executed by the borrower in
favour of the consortium
term lenders
4. Guarantee User Note in relation to This user note is to facilitate
confirmation Guarantee, confirmation letter the users for finalisation of
from guarantor guarantee to be executed by
the guarantors in favour of
the consortium term lenders
5. Mortgage by User Note in relation to This user note is to facilitate
deposit of Title mortgage by deposit of title the users for finalisation of
Deed/Equitable deeds / equitable mortgage memorandum of entry in
Mortgage connection with equitable
mortgage
6. Mortgage User Note in relation to This user note is to facilitate

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created under mortgage created under the users for finalisation of

Mortgage mortgage deed mortgage deed, supplemental
Deed mortgage deed
7. Pledge User Note in relation to pledge This user note is to facilitate
agreement agreement, confirmation letter the users for finalisation of
from pledgor pledge agt.of demat shares to
be executed by the pledgor/s
in favour of the consortium
term lenders

Working Capital Facilities for view/comments (addition)

S.No. Title Description Remarks

1. Inter se Revised Inter se agreement for
agreement working capital facilities

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